An Update on Alcohol Delivery in Alabama

A year ago we wrote about Alabama’s then-new alcohol laws, which allowed (1) ABC Board-licensed businesses in the state to deliver wine, beer, and spirits to customers’ homes and (2) wineries anywhere in the country to ship limited quantities of wine directly to Alabama consumers.

In that article, we referenced the late, great Merle Haggard’s song “I think I’ll Just Stay Here and Drink.” A year later, we’re left wondering if Merle was right when he sang “The Bottle Let me Down.”

To be fair, there has been progress on both fronts. Since the laws have taken effect – August 2021 for wine shipments and October 2021 for alcohol delivery – a number of businesses have taken advantage of this opportunity, particularly direct-to-consumer wine licensees.

On the other hand, ABC has faced backlash for its interest in the home delivery business. After the ABC board filed a state request to solicit bids from contractors to deliver alcohol from its local ABC stores, a group representing privately owned liquor stores in Alabama threatened to take legal action against ABC. The Alabama Beverage Licensees Association claims such an action is illegal.

1. Home Delivery of Beer, Wine, and Spirits

For more than a year, ABC-licensed businesses have been able to deliver wine, beer, and spirits to customers’ homes. The law allows licensees to use either their employees or third-party contractors to deliver alcohol to customers. ABC has a number of checks in place to secure alcohol is only delivered to appropriate customers:

• Delivery employees are subject to criminal background checks and must be trained and certified through the licensees’ pre-approved training program to help with identifying underage or intoxicated individuals and fake or altered IDs.
• Drivers must ensure payment has been processed before removing the alcohol from the premises.
• To confirm customers are age 21 or older, they are required to provide a signature and government-issued ID that drivers then verify using ID scanning software.
• If the recipient cannot prove his or her age, fails to provide a signature, or appears intoxicated, the delivery person must return the alcoholic beverage delivery to the retailer.

As of this writing, there are a total of 11 delivery service licensees authorized to delivery alcohol in Alabama. However, these companies only offer beer, liquor, and wine from select retailers and are limited to small territories. For example, FetchMe offers liquor, beer, and wine delivery in the Auburn-Opelika area and BUZD offers delivery to Birmingham, Crestwood, Irondale, Mountain Brook, Hoover, Homewood, and Cahaba Heights. While some businesses are hoping to expand their operations, these are mainly companies servicing the Birmingham area.

2. Direct-to-Consumer Wine Shipments

The Alabama Legislature also allowed wineries anywhere in the country to ship limited quantities of wine directly to Alabama consumers. Customers are able to buy up to 12 9-liter cases of wine a year from a winery.

As of this writing, there are approximately 192 direct wine shippers. While this does not offer quick access as compared to home delivery, direct shipment is available for anyone statewide and provides consumers with a wide variety of retailers.

3. What Does All of This Mean?

The numbers of licensed alcohol delivery services and wineries that have signed up for direct-to-consumer wine shipments both seem low to us after a year. And we think there may be at least a couple of explanations.

First, when it comes to alcohol delivery services, the provider must invest substantial resources in building out a platform to deliver alcohol.

Second, it is one thing to change the law – and another thing altogether to change consumer habits. Alabamians are accustomed to purchasing wine and beer at a grocery store and liquor at a liquor store. The fact that they are now allowed to have those products delivered to their home does not necessarily mean that they will choose that option, particularly when there are few delivery options at this time and those delivery options include additional fees and driver tips.

Ultimately, we are still bullish on the future of alcohol delivery and direct-to-consumer wine shipments in Alabama. That it has taken some time to get off the ground seems to be more a function of understandable growing pains than any fundamental flaws with the program.

In the meantime, drink up (responsibly, in moderation, etc.)!